Blantyre Co ltd is a toy manufacturer whose equity: debt ratio is 5:2. The corporate debt, which is assumed to be risk-free, has a gross redemption yield of 11%. The beta value of the company's equity is 1.1. The average return on the stock market is 16%. The corporation tax rate is 30%. The company is considering a confectionery manufacturing project. The Blue Line ltd is a confectionery manufacturing company. It has an equity beta of 1.59 and an equity: debt ratio of 2:1. Blantyre Co ltd maintains its existing capital structure after the implementation of the new project. Required: What would be a suitable risk adjusted cost of equity to apply to the project